The 8 Best Peer-to-Peer Lending Companies of 2019

When you need to borrow or invest, check out these options

We are committed to researching, testing, and recommending the best products. We may receive commissions from purchases made after visiting links within our content. Learn more about our review process.

Peer-to-peer lending is a multi-billion dollar industry – but is it the right place for you to be borrowing from or investing your money? Before deciding to borrow from a peer-to-peer lender, consider your financial goals. How much money do you need? What will you be using the money for? If you are going to be using the loan to pay off debt, what is your current interest rate on that debt? If you do the research and find a loan that is offering a substantially lower interest rate than what you are currently paying, you still need to do a bit of digging. Is there a penalty for repaying the loan early? Is the interest rate fixed or variable?

When it comes to investing, it pays to do your research. Many of the companies on this list allow you to either manually choose the loans you invest in or pick an autopilot investment strategy based on your financial goals. If you are not a well-versed investor, it might make sense to choose the latter option, although investment pros might stand to earn a bit more money by manually screening their investments. Before you invest in any of these loans, research the lending company itself as well as the loan products you are considering.

01

When you think of peer-to-peer investing, you might think of Lending Club – and with good reason. They have loaned over $35 billion and, in 2014, became the first-ever publicly traded peer lending company. It currently dominates the market, with a 45 percent share. Lending Club offers personal loans of up to $40,000 and loans of up to $300,000 for businesses. Business loans are provided with one- to five-year loan terms and have a fixed interest rate. Their origination fees range from 1.99 to 8.99 percent with no penalties for paying the loan off early. For investors, just $1,000 will get you started on the site. You can automate the investment process or choose individual loans, and you also have the option of opening joint and trust accounts.

02

Unlike traditional lenders, Upstart looks at so much more than just your credit score when evaluating your creditworthiness. They also take into account your education, area of study, and job history before coming to a decision. Borrowers can get a loan of up to $50,000, starting at 8.85 percent interest. Loans are only offered in three- or five-year terms, but there is no penalty for prepaying. Investors have the option of setting up an IRA on the site, which is a nice perk few peer-to-peer lending sites offer. Because the average income of a borrower is $83,000, you have a great chance of getting a return on your investment. Upstart boasts that it has 173 percent more approvals with the same default rate when compared to big banks or have 75 percent fewer defaults with the same approval rate as big banks based on how they qualify borrowers.

03

It is not easy being a landlord. There are a lot of things you need to be prepared for and a lot of work to be done. If you want to invest in real estate but do not see yourself as landlord material, FundRise offers a way to invest. When you invest with Fundrise, you are investing in private real estate that is purchased through a negotiated sale to keep prices low making it a lot different in comparison to the stock market. You can make a single investment and get diversified across multiple individual real estate assets. Fundraise requires a minimum investment of $500 and has historical annual returns of 8.7 to 12.4 percent. Getting started is easy. You can have Fundrise 2.0 review your goals and select the eFunds and eREITS, Real Estate Investment Trust, for you. Keep in mind the better the potential to earn money, the higher the risk of the investment.

04

Funding Circle works to help businesses who have already proven their viability grow and expand. You can borrow up to $500,000 for up to five years if you show your creditworthiness, and you get the cash in as few as five days. They have worked with over 40,000 businesses in the U.S. and U.K. Expect a 4.99 percent origination fee based on the amount of money you are financing, which is typical of peer-to-peer loans. Business loan rates start as low as 5.49 percent and go up to 20.99 percent. Unless you have $250,000 to invest, this is not the company for you. But if you do, you can choose whether you want to “set it and forget it,” letting an algorithm tell you where you should invest, or pick individual loans to fund. The U.K. government trusts Funding Circle with their money, as do tens of thousands of financial investors and banks. With nearly 5,000 reviews on trustpilot.com, Funding Circle has 86 percent of reviewers score them as excellent.

05

If you have been in business for at least a year and earn a decent revenue, then your business can get a loan of up to $100,000 for up to three years through StreetShares, with no prepayment penalties. They also offer options for a line of credit and contract financing, which takes into account your earnings potential and will provide you with a loan amount based on your ability to repay. StreetShares works directly in veteran markets providing loans for veteran business owners. So if you are a veteran with a business and need financing, or if you want to support and invest in a veteran business bond, StreetShares is the peer-to-peer lending service for you. As an investor, the process is simple: you can invest up to $500,000 and earn a flat five percent. If you withdraw the money before the end of the year, you’ll pay a one percent penalty – but four percent is still a lot better than keeping your money in a savings account.

06

Don’t let the Peerform website scare you off: Despite the simple style that reminds you of the 1990s, Peerform was founded by tech and finance experts nearly two decades ago, and the company provides loans/investment opportunities that are both transparent and fast. If you are looking to borrow, you can get a loan of up to $25,000 with an interest rate that depends on your credit score. They offer fixed rates from 5.99 to 29.99 percent with no collateral required. As an investor, you can choose from over 16 different risk categories, and you can choose to fund either the entirety of a loan or invest in small chunks of a peer-funded loan, which Peerform refers to as a “fractional loan.” Peer-to-peer lending is growing right now, and Peerform works hard to prevent fraud through their State of the Art Fraud Prevention System.

07

In 2005, Prosper became the first peer-to-peer lending site, and they have since helped hundreds of thousands of people secure over $13 billion in loans. If you are looking to borrow through Prosper, you can see what your interest rate will be through the site without impacting your credit score. Loans come in either three or five-year terms and are fixed-rate loans, which means your interest rate will never go up or down. If your fortunes change, you can prepay early without penalty. Origination fees on small business loans vary based on the length of the loan. It ranges from 2.41 to five percent. As an investor, you can select from seven different risk categories, from AA down to HR (high risk). Prosper anticipates that investors can expect to see a 4.99 percent return on AA investments, up to 13.48 percent on E grade investments. You only need to invest $25 to get started.

08

Kiva is a bit different than the other platforms on this list: it’s a peer-to-peer lending site that you invest in out of the goodness of your heart, not to make a profit. Rather than investing in loans of a particular grade, with Kiva, you invest in specific projects or individuals with a name and a face. With as little as $25, you can help a rural Ugandan farmer buy chicken seed, or help a Pakistani woman buy an embroidery machine for her business. All potential lendees are vetted and approved before they go on the site, so you know they are legitimate, and the loans have a payback rate of 97 percent. The charity watchdog group has given Kiva their highest rating, so you can rest assured that your money is being spent (and repaid) wisely. Those looking to borrow through Kiva anywhere around the world can apply for an interest-free loan of up to $10,000. You will get slow, and steady “income” as the loan is repaid, but just for the amount you lent, not for anything else. This is a new spin on giving to charity. The impact you could make on someone’s life is priceless.